Market Close: Telecom rises from 2 decade low, while NZX continues to slide

Friday 4th June 2010

New Zealand shares rose, as Telecom (NZX: TEL ) climbed from a two-decade low and NZX (NZX: NZX ) extended its slide since the announcement it had missed been chosen as the new electricity forwards market.

The NZX 50 Index rose 6.03, or 0.2%, to 3030.13, its second daily gain. Within the index, 19 stocks rose, 15 fell and 16 were unchanged. Turnover was $52 million.

Telecom rose 1.6% to $1.86. The shares fell to $1.83 yesterday, the lowest since it was a fledgling stock on the exchange in the early 1990s. At today’s price, the stock has a dividend yield of 19.6% based on its payments over the past 12 months. Telstra (ASX:TLS), which yields 13%, rose 1.6% to $3.83.

New Zealand Oil & Gas (NZX: NZO ) rose 2.9% to $1.40 and Pan Pacific Petroleum (NZX: PPP ) gained 3.9% to 27 cents, the biggest gain on the NZX 50 today, as the price of crude oil held above US$74 a barrel.

NZX fell 1.9% to $1.55, adding to yesterday’s 1.9% slide, when the country’s five top electricity generators said they would use the ASX to operate a new electricity forward market. NZX chief executive Mark Weldon though says the dairy derivatives plan is still in tact - story here

NZX, whose stock has fallen by about a third this year, has been positioning itself to grow from new derivatives markets, and told an investor presentation in March that it was anticipating half of its revenues to come from derivatives trading in five years time.

Pike River Coal (NZX: PRC ) fell 3.1% to 95 cents. PGG Wrightson (NZX: PGW ) fell 1.8% to 54 cents.

Wakefield Health (NZX: WFD ) was unchanged at $7 after announcing a sweetened offer for Norfolk Investments, which controls Tauranga’s Grace Hospital, and said it has binding acceptances for more than 50% of the stock. It lifted its offer to $3.60 a share from $3.52, valuing the target at about $23 million.

Businesswire.co.nz

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